Kajaria Ceramics – A quality business facing poor industry economics
February 14, 2020 / 09:52 AM IST
PRO Only Highlights
Quarterly performance largely backed by improved realisations
Medium-term triggers China plus and protectionist measures for tyre industry
Valuations not inexpensive; but improved medium-term outlook
Kajaria Ceramics is struggling to grow its revenues and volumes due to competitive market dynamics and sluggish consumer spending. Its Q3 FY20 results were disappointing as volumes were largely flat and realisations continued to see downward pressure due to subdued economic activity.
In the December quarter, sales declined 2 percent year-on-year (YoY) to Rs 741 crore. A marginal increase in tile volumes (up 1 percent YoY) was largely offset by the 3 percent dip in realisations. Gross profits...